Colorado Overtime Laws & Wages Attorney

Table of contents:

1. Colorado’s Minimum Wage Rates
2. Denver Minimum Wage Laws
3. Minimum Wage Rules For Tipped Employees
4. Overtime Pay Regulations in Colorado
5. Special Overtime Rules for Healthcare Workers
6. Special Overtime Rules for Salaried Employees
7. Special Overtime Rules For Truck Drivers
8. What Are the COMPS Orders?
9. Overtime And Minimum Wage Exemptions In Colorado
10. Refusing to Work Overtime in Colorado
11. Overtime Pay Calculations
12. Colorado Independent Contractor Rules
13. In-home Caregivers and Personal Care Attendants
14. Holiday Pay, Vacation Pay, and Payout at Termination
15. Breaks, Meals, and Lodging Rules
16. Pay Periods for Colorado Workers
17. Pay Statement Requirements
18. Salary Deductions For Salaried Employees
19. Retaliation Against Employees Is Illegal

In recent years, Colorado has introduced significant reforms to its minimum wage and overtime pay laws, strengthening worker protections beyond those provided by federal standards. Despite these advancements, not all employers comply with the mandated requirements. If you find that you’re not being compensated fairly in accordance with federal or Colorado wage laws, The Lore Law Firm is here to help.

For more information, contact a Colorado overtime laws & wages attorney or visit our comprehensive state labor laws guide.

Colorado’s Minimum Wage Laws

As of January 1, 2024, the minimum wage in Colorado for non-tipped employees is $14.42 per hour. The state constitution requires annual minimum wage increases based on inflation, but local municipalities are allowed to set a higher rate if they desire. If you have concerns about your wages or believe your employer is violating wage laws, a Colorado overtime laws & wages lawyer can help protect your rights.

Denver Minimum Wage Laws

As of January 1, 2024, the minimum wage in Denver is $18.29 for non-tipped employees, which is higher than the state minimum wage or the minimum wage in neighboring counties.

Minimum Wage Rules For Tipped Employees

In Colorado, tipped employees must be paid $11.40 per hour. However, the employer must pay any difference between this hourly rate plus tips and the regular minimum wage rate. In Denver, tipped employees must earn a minimum of $15.27 per hour.

Employers of tipped workers may deduct a tip credit from the minimum wage of no more than $3.02 per hour. An employer may not claim tip credits toward the regular minimum wage rate if employees are required to share their tips with employees who do not regularly receive tips or if the employer deducts credit card processing fees from the employees’ tips.

Overtime Pay Regulations in Colorado

Colorado’s overtime rules are more favorable to employees than those provided under federal law. Non-exempt workers (which are most workers) must be paid time and a half, or 1.5 times their regular pay rate, for any work in excess of:

• 40 hours per workweek
• 12 hours per workday
• 12 consecutive hours, regardless of the start and end time of the workday

The employer must pay whichever calculation results in higher payment. If your employer fails to comply with these rules, a Colorado attorney can help you recover unpaid wages.

The regular rate for employees who are paid a weekly salary, or on some other non-hourly basis, may be their total pay divided by hours worked – provided that the salary provides at least minimum wage for all hours in workweeks with the greatest hours. If this requirement is not met, the employee’s regular rate on which overtime pay must be based will be their total weekly pay divided by 40 hours.

Colorado employers must firmly establish the workweek, which is defined as 168 hours (or seven consecutive 24-hour days). An employer may not average multiple workweeks together to pay employees less or no overtime. A workday is a consecutive 24-hour period beginning at the same hour each day.

The state’s overtime rules do not generally limit the number of hours per week an employer may require its employees to work. One exception is that employees working in certain hazardous jobs (e.g., smelting and underground mining) may not work more than eight hours in one 24-hour period.

Special Overtime Rules for Healthcare Workers

Like some states, Colorado has special overtime rules for healthcare workers. A hospital or nursing home may seek an agreement with individual employees to pay overtime pursuant to the provisions of the federal Fair Labor Standards Act’s “8 and 80 rule.” Under this rule, employees are paid 1.5 times their regular rate of pay for any work performed in excess of 80 hours in a 14 consecutive day period and for any work in excess of 8 hours per day.

Special Overtime Rules for Salaried Employees

In Colorado, non-exempt salaried employees are eligible for overtime pay if they work more than 40 hours in a week. The calculation of overtime pay begins once the 40-hour threshold is exceeded within the workweek. It’s important for salaried, non-exempt workers to understand that their base salary covers only the standard 40-hour workweek; any hours worked beyond that must be compensated at a rate of at least 1.5 times their regular hourly rate.

Special Overtime Rules For Truck Drivers

Colorado state law does require that to be exempt, truck drivers and drivers’ helpers must be paid at least 50 hours at the Colorado minimum wage rate, including overtime at 1.5 times the minimum wage. As of 2022, a truck driver or helper must earn at least $690.80 per week ($12.56 x 40 hours + $12.56 x 1.5 x 10 hours) to be exempt from overtime under Colorado state law.

What Are the COMPS Orders?

The Colorado Overtime and Minimum Pay Standards Orders (COMPS Orders) regulate minimum wage and overtime rules in the state. Recently enacted versions of the COMPS Order accomplished the following objectives:

• Expanded coverage of the minimum wage and overtime regulations to most industries
• Increased the minimum salary required for the most common exemptions
• Placed greater limitations on exemptions from the overtime requirements
• Expanded the definition of time worked

The most recent updates, COMPS Order #39, have introduced several key changes effective from January 1, 2024:

• Tipped Employees: Sets a new threshold for “tipped employees”.
• Tip-Pooling Changes: Tipped employees who perform significant customer-service duties are eligible for tip pools and credits, affecting roles such as servers, bussers, counter personnel, chefs, bartenders, sommeliers, and bellhops.
• Regular Rate of Pay: Tips are now expressly excluded from the regular rate of pay calculations for overtime, ensuring clarity and alignment with federal law.

Overtime And Minimum Wage Exemptions In Colorado

Certain workers are exempt from the state’s minimum wage and/or overtime requirements. Some examples are:

• Salaried administrative employees
• Salaried executives or supervisors
• Salaried professional employees
• Outside salespersons
• Computer professionals

Some individuals, however, are only exempt from overtime rules and not minimum wage rules. Examples of these workers include:

• Certain employees of automobile, truck, or farm implement retail dealers
• Salespersons employed by trailer, aircraft, and boat retail dealers
• Commission salespeople, provided they earn at least 50% of their total earnings in commissions and their regular rate of pay is at least time and a half minimum wage
• Ski industry employees (exempt only from the 40-hour workweek overtime requirement)

Many of the wage and hour exemptions require that the employee be paid a minimum salary, the amount of which adjusts annually through 2025. The most recent, current, and future rates are:

• January 1, 2021 – $778.85/week or $40,500/year
• January 1, 2022 – $865.38/week or $45,000/year
• January 1, 2023 – $961.54/week or $50,000/year
• January 1, 2024 – $1,057.69/week or $55,000/year
• January 1, 2025 – Adjusted based on the Consumer Price Index

Colorado law requires executive employees to receive at least minimum wage for all hours worked, which could result in a higher salary requirement than federal law.

Refusing to Work Overtime in Colorado

In Colorado, employees typically cannot refuse to work overtime due to the absence of specific state laws prohibiting this, making the federal Fair Labor Standards Act (FLSA) the governing legislation. The FLSA allows employers to mandate overtime, except when an employment contract or collective bargaining agreement stipulates otherwise. While Colorado does not specifically prohibit mandatory overtime, any overtime worked must be compensated at 1.5 times the regular rate for hours beyond the standard 40-hour workweek unless exemptions apply. Employees should carefully review any employment or union agreements that might impact their obligations and rights concerning overtime.

Overtime Pay Calculations

Overtime pay calculations in Colorado incorporate more than just an employee’s hourly rate. They also include certain types of bonuses, commissions, and other incentive payments (including holiday pay), which contribute to what’s termed the ‘regular rate of pay’. Understanding how overtime is calculated is vital for employees to ensure they are fully compensated.

Here are some examples:

• A non-exempt employee earns $22 per hour. If they work 46 hours in one week, their overtime pay for the additional 6 hours would be calculated at 1.5 times their hourly rate. This means they would earn an extra $198 for that week ($22 x 1.5 x 6 hours).
• Similarly, a non-exempt salaried employee making $600 per week, calculated over a standard 40-hour workweek, has an effective hourly rate of $15. If they work 45 hours in a week, their overtime rate would be $22.50 per hour (1.5 times the hourly rate). Thus, for 5 hours of overtime, they would earn an additional $112.50.
• If a non-exempt employee earns $20 per hour and receives an additional $100 in holiday incentive pay for a week they worked 50 hours, the holiday incentive pay should be added to their regular earnings when determining their overtime rate. In this case, the regular straight time pay for 50 hours would be $1,000 ($20 x 50), plus $100 in holiday incentive pay, making the total $1,100. The regular rate of pay, therefore, becomes $22 per hour ($1,100 ÷ 50 hours). Overtime pay is then calculated at 1.5 times this regular rate, or $33 per hour. So, 40 straight time hours x $22 regular rate = $880 plus 10 overtime hours x $33 = $330 for total earnings of $1,210 for the week.

These examples highlight the need for employees to be aware of how their earnings are computed, ensuring they receive all due work compensation accurately.

Colorado Independent Contractor Rules

Certain individuals fall outside the definition of an “employee” under Colorado’s wage and hour laws. That means that they are not entitled to a minimum wage or overtime pay. As is common elsewhere, employers often abuse this system by claiming that actual employees are independent contractors.

To be properly classified as an independent contractor, a worker must be (a) primarily free from control and direction in the performance of his or her duties, and (b) customarily engaged in an independent trade, occupation, profession, or business. A number of factors must be considered in determining if a worker is an employee or an independent contractor. An agreement or label is not enough.

In-home Caregivers and Personal Care Attendants

In-home care workers employed in Colorado by or through a home healthcare company may be entitled to overtime pay. A federal court ruling determined that “companion” employees must be paid overtime under Colorado state law if they are employed by a third-party agency. Caregivers employed directly by individuals (not through staffing or home health agencies) remain exempt from Colorado’s overtime pay requirements.

Also, a new rule provides an exemption from the above-mentioned 12-hour daily overtime requirement for direct care and direct support “companions” who are Medicaid-funded and who work shifts of 24 hours or longer.

Holiday Pay, Vacation Pay, and Payout at Termination

Colorado employers are not required to provide vacation, holiday, or other pay for the time that is not worked. However, if vacation benefits are provided, they may not be taken away from workers for any reason. Also, any unused accrued vacation pay balance must be paid out when an employee leaves the company. In other words, workers’ vacation benefits can’t be forfeited when they leave a company, even if they signed agreements allowing for such forfeiture if they are fired or if they fail to give two weeks’ notice.

If you believe your employer has wrongfully withheld wages or overtime pay, consulting a Colorado overtime laws & wages lawyer can help you understand your rights and pursue the compensation you’re owed.

Breaks, Meals, and Lodging Rules

Under state labor laws, employees in Colorado are entitled to specific breaks, meals, and lodging accommodations. Employees who work more than five consecutive hours are granted an uninterrupted, duty-free 30-minute meal period. During this time, they must be completely relieved of all work duties and free to engage in personal activities. If a full, uninterrupted break is impractical due to the nature of the job, an on-duty meal period is allowed, during which employees should be paid.

Additionally, every employee is entitled to a paid 10-minute rest period for every four hours worked. These rest periods should ideally occur midway through the work segment to maximize relaxation and productivity.

Employers can also provide meals and lodging as part of compensation but must adhere to certain restrictions. For instance, the value of lodging used to meet minimum wage requirements cannot exceed $25 per week for a shared room or $100 per week for a private residence. The value of meals provided can count towards the minimum wage but must reflect reasonable cost or fair market value without profit. Employees must have the freedom to accept or decline these provisions without coercion. These rules ensure fair compensation while acknowledging the practical needs of different work environments.

Pay Periods for Colorado Workers

Employers and employees may contractually agree to set pay periods. This typically applies to both hourly and salaried workers. In the absence of such an agreement, all wages or compensation shall be due and payable for regular pay periods of no greater time duration than one calendar month or thirty days, whichever is longer. Additionally, regular paydays must be no later than ten days following the close of each pay period.

Pay Statement Requirements

Pay stubs or statements must be issued for every pay period (or once a month) and must include the following information:

• Gross wages earned
• All withholdings and deductions
• Net wages earned
• The inclusive dates of the pay period
• The name of the employee or the employee’s Social Security Number
• The name and address of the employer

No Rules for Reporting Time Pay

Some employers do a poor job of scheduling shifts, allowing workers to show up and either not work at all or not work the full number of hours they were promised. Unfortunately, neither Colorado nor federal law requires an employee to be paid if he or she reports to work but does not get to work their full schedule.

All Time Worked Must Be Paid

Employees must be paid for all time worked. “Time worked” includes time during which an employee is performing labor or services for the benefit of an employer. This definition also covers all time the employee is permitted to work, whether or not required to do so.

Time worked also includes any time the employee is required or permitted to be on the employer’s premises, time the employee is on duty, and time spent at a prescribed workplace. The following is a list of specific activities for which the worker must be paid if such tasks take over one minute:

• Putting on or removing required work clothes or gear (but not a uniform worn outside work as well)
• Receiving or sharing work-related information
• Security or safety screenings
• Remaining at the place of employment, awaiting a decision on a job assignment or when to begin work
• Performing clean-up or other duties “off the clock”
• Clocking or checking in or out
• Waiting for any of the preceding activities
• Certain travel time is also included in the definition of time worked, including employer-mandated transportation (1) that materially prolongs commute time or (2) in which employees are subjected to heightened physical risk compared to an ordinary commute. Certain sleep time may also constitute paid time worked.

If you believe your employer is violating wage and hour laws, a Colorado attorney can help ensure you receive fair compensation.

Deductions From Employee Pay

According to the FLSA, deductions for items including uniforms, shortages, damaged goods, or trade tools cannot decrease the employee’s hourly wage below the minimum rate. Colorado also has certain rules regarding these and other deductions. For example, employers cannot deduct the cost of ordinary wear and tear on a uniform from an employee’s wages. If you have questions about deductions, check with an experienced Colorado wage and hour attorney.

Salary Deductions For Salaried Employees

In Colorado, salary deductions for salaried employees are regulated to ensure fair labor practices. Salaried employees, particularly those classified as exempt from overtime under the FLSA, are generally entitled to their full salary for any week they perform work, regardless of the number of hours worked. There are clear guidelines surrounding permissible and impermissible salary deductions for salaried employees. Legally acceptable deductions include those mandated by law, such as taxes and garnishments, and those agreed upon in writing, like loan repayments or equipment costs. Additionally, employers may deduct for theft-related shortages if specific criteria are met and for union dues or cases where an employee fails to pay or return money or property owed to the employer.

However, certain deductions are not allowed. Employers in Colorado cannot deduct costs for property damage or depreciation from an employee’s wages. Similarly, fines for employee behavior or performance issues, such as deducting meal costs from a waiter’s wages due to a customer’s non-payment, are also prohibited. These regulations are designed to protect employees from unfair wage practices while allowing employers to make necessary deductions responsibly. If you believe your wages have been unlawfully deducted, a Colorado overtime and wages attorney can help protect your rights.

Statute of Limitations For Wage And Hour Complaints in Colorado

If you were not paid fairly or accurately for your work, you only have a limited amount of time to file a complaint. Your claim must be brought within two years after the failure to pay the wages due, except for “willful” violations, which must be commenced within three years. This matches the federal (FLSA) standard.

However, it is not advised that you wait until the two- or three-year mark. The sooner you commence legal action, the more likely you will maximize your recovery, and that important details and records will be preserved.

State Law Remedies and Penalties

Any employee who is not paid all of the wages to which he or she is legally entitled may file a claim for the unpaid wages, along with reasonable attorney fees and court costs.

Retaliation Against Employees Is Illegal

If an employer retaliates against an employee for exercising their rights under the minimum wage and overtime laws, it could face criminal penalties, including a fine and jail time. In addition, the Wage Transparency Act prohibits Colorado employers from forcing employees to give up their right to disclose their wages as a condition of employment. Employers may not retaliate against an employee in any way for disclosing his or her wage.

Contact Our Colorado Wage And Hour Lawyer

Colorado’s labor laws are complex, with a number of detailed definitions, exceptions, and applicable regulations. Perhaps your employer has failed to pay you minimum wage or overtime. Or there may be another provision of the state’s wage and hour laws that your employer has violated. Either way, let a Colorado overtime laws & wages attorney at The Lore Law Firm help you assert your legal rights. Contact us through our online form today for a confidential review of your situation.